Biz Tips: Why Brands Love Instagram Ads to Market Their Products

November 29, 2018

GROWTH:

Why Brands Love Instagram Ads to Market Their Products

As of September 2017, there were 2 million businesses actively advertising on Instagram on a monthly basis. This is impressive considering how in March of the same year, the number of monthly advertisers stood at one million.

This shows just how popular Instagram is as an advertising platform for brands around the world; and there’s no surprise about that, since brands that advertised on Instagram have achieved impressive results in the form of brand awareness and ad recall.

Aside from the fact that Instagram is the second most popular mobile social networking app in the U.S., it is also the most engaged social media platform. Plus there are tons of new and innovative features and formats that enable advertisers to achieve optimal results.

In this post, we’re going to take a closer look at Instagram ads and why top brands like Adidas and Louis Vuitton love to use it to market their products.

#1: Video Engagement on Instagram is Growing

Although photos on Instagram are still getting a lot more engagement than videos, the engagement rate of videos on the platform is increasing. This has resulted in a lot more brands investing in Instagram video ads to engage a relevant audience.

According to Animoto, more than half of marketers in their survey expressed an intention to increase their spending on Instagram video ads.

Unsurprisingly, we should expect social ad revenue to reach $11 billion by 2020. NewsWhip conducted a study of top Instagram publishers and found that engagement on video posts increased by 53% between May 2016 and May 2017. Image posts also saw a 46.4% increase in engagement during this period, which is still significant but lower than that of video posts.

Image Source: NewsWhip

The same study found that although photos tend to get more likes per post, videos managed to drive more comments on average. The NewsWhip team hypothesized that this is likely because people are pausing and taking the time to watch videos, so there’s more opportunity for engagement during this period of pause.

But in the case of photos, users quickly scroll past them after double-tapping on the ones they like. They rarely take the time to pause and engage with the photos. Brands like Lululemon even saw that their video ads had twice as much engagement as their images.

The best part is that consumers don’t just engage with videos on Instagram. They find purchase inspiration and make buying decisions from these videos. In fact, the Animoto study found that 31% of consumers have been influenced to make a purchase after watching a video on Instagram.

With Instagram video ads, you get to tell a compelling visual story in a matter of seconds. You’re not forcing your target customers to read through blocks of text to understand your product. Instead, you’re catering to their short attention spans with short videos that strongly position your product in as little time as possible.

For Volvo, Instagram video ads gave them the perfect opportunity to create an interactive campaign to thoroughly engage their target audience. They developed a “thumb drive,” which allowed people to go on a virtual test drive in the Volvo XC60, exploring key markets such as San Francisco and New York. They managed to engage people with video adverts created specifically for their city.

#2: Instagram-Stories Ads Help Raise Brand Awareness

The fact that Instagram started allowing brands to run ads on its Stories feature is another reason why the platform is so popular among brands that want to market their products. Brands love Instagram

Stories because of its increasing popularity among Instagram users.

As of June 2018, 400 million users posted on Instagram Stories on a daily basis. The number has grown by 100 million in just eight months.

Image Source: Statista

Even Social Media Week has been urging marketers to start investing in Stories ads for a while. As it is, brands are already getting tons of organic reach through Stories. According to a study conducted by Socialbakers, Stories account for 19% of impressions for brands.

And for the brands they analyzed, Stories were the sole source of one-fifth of their impressions. So if brands are managing to get such impressive results from organic Stories alone, it’s only natural that the paid versions will drive even better brand awareness.

Take for example how global fashion retailer, ASOS, leveraged Stories ads to increase brand awareness and drive more engagements for their brand. They wanted to immerse their target audience into the ASOS brand. And their target audience being fashion conscious and digitally native, Stories offered the perfect channel to reach them where they are.

They created a series of ads that looked like they were shot on mobile, just like the type of content created by typical Stories users. The footage felt native to the format so it could fit right in with the content from other users. And instead of pushing a particular product, the brand’s main focus was to raise brand awareness by promoting their key message.

The ads featured models in a wide variety of clothing styles from formals to sportswear. This helped showcase the diversity of the brand’s product offering.

Image Source: Instagram

As expected, the campaign drove impressive results and reached 3 million people. ASOS saw a 3-point increase in brand awareness and a 14-point increase in ad recall. In the US market, they saw a 7-point increase in brand awareness and an 8-point increase in brand recall.

And it’s not just ASOS that benefited from using Instagram Stories to run ads. Louis Vuitton became the first luxury fashion brand to run Stories ads and managed to generate outstanding results. The brand made the most of the vertical screen to show full-length model shots promoting their men’s Spring/Summer 2017 collection.

Image Source: Instagram

Not only did they see a remarkable 28-point lift in ad recall, they also experienced an increase in brand favorability. The campaign resulted in a 2-point increase in recommendations.

#3: Ads Featuring Influencers Deliver Outstanding Results

It’s a known fact that influencer marketing is a highly effective way to reach and engage audiences today. And Instagram is one of the best platforms for carrying out influencer marketing campaigns.

In fact, Klear found that influencer marketing on Instagram grew by 198% during 2017. Their study showed that the trend is experiencing a 5% month-over-month average growth on a constant basis.

While influencer marketing may be popular across various platforms and channels, Instagram seems to be the most favorable platform for both brands and influencers. 92% of marketers in a Linqia study voted it as the most important social platform in their influencer marketing strategy. And 87.1% of influencers in a HASHOFF study voted it as their number one platform.

Brands are getting even more creative with their Instagram influencer marketing campaigns. More than 50% of marketers in a survey conducted by ANA are amplifying their influencer campaigns with paid media. This doesn’t just involve using influencer-created content for their ads, but also includes creating branded content that features influencers.

This can have a remarkable impact since Instagram’s accurate targeting and paid amplification will ensure that the content reaches a huge and relevant audience. Plus, seeing an influential personality in these ads could win over a lot of consumers who trust and look up to those personalities.

Adidas Originals made the most of this in their campaign to celebrate true creators and embrace originality. They aimed to engage young creators based in Russia and started a conversation on what it means to be original.

For this campaign, the brand created an impactful video that featured renowned visionaries in different creative fields such as music, sports, and art. The video included influential personalities like Snoop Dogg, Kareem Abdul-Jabbar, Stormzy, and Petra Collins.

Image Source: Instagram

Adidas Originals saw an overall increase in ad recall by 20 points. The number rose even higher to 27 points among the age group of 18- to 24-year-olds. As the brand had anticipated, they also saw an increase in brand perception as “unique” by 10 points.

Global designer brands like Michael Kors have combined influencer marketing and Stories ads to create an impactful marketing mix. The brand worked with influential model, Martha Hunt, to promote the new Michael Kors Access smartwatch. They created short and fast-paced videos that younger millennial women would find relatable.

The video featured the influencer using the smartwatch in a variety of realistic situations. They then used Instagram Stories to deliver these ads to the right target audience. Through this campaign, Michael Kors saw a lift in ad recall by 24 points. But the best part is that there was a 99-point increase in favorability as a result of the Instagram Stories.

Image Source: Instagram

For both Adidas Originals and Michael Kors, working with premium influencers and celebrity influencers played a huge role in the success of their Instagram ads. While bigger influencers aren’t necessarily better, they may be able to generate more brand awareness through your ads because they’re widely recognized. It’s important that you carefully consider your choice of influencers depending on your campaign goal and target audience.

Another reason why brands love Instagram ads to market their products is because they have an increased chance of targeting and reaching the right audience. This is important considering how nearly half of online campaigns in the U.K miss their target audience, according to Nielsen.

Some of the biggest advertising challenges faced by marketers include attracting a target audience and reaching them in a compelling and meaningful manner.

With Instagram’s effective audience targeting feature, brands have a better chance of reaching the most relevant audience and attracting them using compelling visual ads. With the ads being more relevant to the target audience, brands can reduce their advertising costs significantly.

The renowned handbag brand, Dagne Dover, managed to accurately target people who are likely to be interested in their bags, helping them reduce their cost per click. They built Custom Audiences for their Instagram ads based on people who are interested in travel.

They also looked through their existing customer profiles to identify similar themes such as customers who are students, new mothers, or career professionals. So they were able to set up Custom Audiences targeting each of these groups and further created Lookalike Audiences to increase their reach.

Dagne Dover managed to generate a return of 13 times their ad spend. Their CTR on Instagram was two times higher than on other platforms. Additionally, their cost per click was 63% lower than on other platforms because the targeting was so accurate.

Image Source: Instagram

Brands can further reach a highly relevant audience and cut down on ad spend through retargeting campaigns on Instagram. Retargeting allows advertisers to reach potential customers in a more compelling and meaningful manner, addressing the challenge mentioned earlier.

It allows brands to deliver their ads to people who have browsed their website. So they can ensure the relevance of the ad content by highlighting products that each prospect had viewed before or added to their cart.

In the case of MeUndies, dynamic Instagram ads helped them re-engage people who had viewed their products but did not make a purchase. The ads featured products that each prospect had expressed an interest in, increasing the relevance of the campaign.

Image Source: Instagram

With this two-day campaign, MeUndies earned a five times return on their ad spend. Their cost per purchase was 25% lower on Instagram than on other campaigns. Additionally, their cost per ad-to-cart action was 30% lower than on other platforms. This proves just how impactful Instagram ads can be to reach the right audience to reduce advertising cost.

Instagram’s Constant Innovation Offers New Ways to Sell

Besides all these factors, the main reason why brands are favoring Instagram ads to market their products is because the platform is constantly evolving. Instagram is always coming up with new ways for brands to market their products.

Take, for example, how they introduced shoppable posts, “Paid Partnership With” tags, and ads in Stories.

Instagram has even started testing Collection ads, where brands can combine videos with their product catalogs. So shoppers won’t even have to leave the platform to complete their purchases. We’re likely to see a lot more brands — both leading and startups — embracing the power of Instagram ads to effectively market their products.